Refinery audit may cut prices by Rs40-50/litre

KARACHI: Petroleum dealers have called for an immediate, transparent and comprehensive forensic audit of the country’s oil refineries, citing a sharp rise in sector profitability and saying that a review of their finances could allow cuts of Rs40-50 per litre in petroleum prices.

According to Topline Securities, refinery sector profitability rose to Rs32.2bn in 1QFY27 from Rs1.6bn in 1QFY26 and Rs1.1bn in 4QFY26, mainly due to higher Gross Refining Margins (GRMs) amid the US-Iran war.

PPDA Chairman Malik Khuda Bakhsh and senior leadership said the petroleum minister’s recent statement on extraordinary refinery profits confirmed concerns and reservations the association had previously raised.

In a statement, PPDA representatives said that the association had repeatedly pointed out that certain refineries had earned unusually high profits, the impact of which had ultimately been borne by ordinary consumers.

Sector earns Rs32.2bn in July-Sept, almost 20 times higher than Rs1.6bn a year ago

They said the petroleum minister had recently revealed that refineries earned, in just three months, profits equivalent to what they would normally generate in an entire year.

They described the disclosure as a serious concern and called for an independent, impartial examination of refinery profits, production costs, pricing mechanisms, and other financial matters to establish the facts.

The PPDA representatives said the government should order a comprehensive forensic audit of the financial records, expenditures, crude oil procurement costs, production expenses and revenues generated from the sale of petroleum products by all oil refineries.

They said such an audit would help establish the circumstances and basis on which refineries earned extraordinary profits and determine how much of the financial burden was directly or indirectly transferred to consumers.

They further stated that the relief provided to consumers should not be portrayed as an additional financial burden on refineries.

The PPDA leaders observed that consumers were already facing severe economic pressure due to inflation, high electricity and gas tariffs, rising transportation costs and increasing prices of essential commodities. In these circumstances, a genuine reduction in petroleum prices could provide substantial relief to the general public.

They maintained that consulting only refineries and other relevant institutions when making important decisions on the petroleum sector was insufficient. Representation of petroleum dealers was equally essential to ensure balanced, practical and effective policies through consultation with all stakeholders.

The government, they said, should make petroleum dealers an integral part of the policymaking process and benefit from their practical experience, recommendations and understanding of market conditions.

Published in Dawn, November 4th, 2026